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Wall St edges higher as North Korea concerns ebb

By Sruthi Shankar and Tanya Agrawal
(Reuters) – U.S. stocks rebounded from steep losses to trade slightly higher on Tuesday afternoon as investors shrugged off concerns over North Korea’s latest missile test.
The Dow Jones Industrial Average had dropped more than 100 points at the open as North Korea’s missile test over Japan escalated tensions with the United States and triggered a flight to safety. Trump warned “all options are on the table”.
The missile, tested early on Tuesday, flew over Japan and landed in the Pacific about 735 miles off the northern region of Hokkaido, a rare occasion when North Korea fired projectiles over mainland Japan.
“This (North Korea) is all sort of tangential to American corporate economy and profitability,” said Stephen Massocca, senior vice president at Wedbush Securities.
“It is kind of a thin field this week, so it’s not tough to move stuff around. I didn’t see it as something to have a significant impact on the market and lo and behold everything has rallied back.”
At 12:33 p.m. ET (1633 GMT), the Dow Jones Industrial Average (DJI) was up 17.27 points, or 0.08 percent, at 21,825.67 and the S&P 500 (SPX) was down 1.24 points, or 0.05 percent at 2,443.
The Nasdaq Composite (IXIC) was up 10.79 points, or 0.17 percent, at 6,293.80.
Demand for safe-haven assets rose. Gold prices jumped to their highest since November, while the benchmark 10-year Treasury yields (US10YT=RR) fell to their lowest since before the U.S. presidential election.
Investors are also closely tracking the impact of Tropical Storm Harvey, which has crippled the U.S. energy hub in Texas.
“Harvey is going to have all sorts of effects on the economy and this may well take two-tenths of our GDP going forward into the next couple of quarters,” said Art Hogan, chief market strategist at Wunderlich Securities.
“Houston is a very large and important city with about 125 S&P companies located in that area.”
Six of the 11 major S&P sectors were lower, with the financial (SPSY) and materials (SPLRCM) sectors leading the decliners.
Nike (N:NKE) fell 2.5 percent, weighing the most on the Dow, after Morgan Stanley (NYSE:MS) cut its price target by $4 to $64.
Best Buy (N:BBY) tumbled 11 percent, posting the biggest percentage loss among S&P companies, after the retailer warned that its strong quarterly same-store sales performance should not be seen as a “new normal”.
United Technologies (N:UTX) rose 1.6 percent after a report that the company has made progress in its talks to acquire aircraft component manufacturer Rockwell Collins (N:COL). Rockwell’s shares rose 1.8 percent.
Declining issues outnumbered advancers on the NYSE by 1,699 to 1,142. On the Nasdaq, 1,450 issues fell and 1,320 advanced.